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Tax Strategies, Retirement Tools, and the Coronavirus

March 12, 2020

The Principle:

Tax Strategies, retirement tools, and the coronavirus. What do these three things have in common? They all are considered in your retirement planning, so Brian talks through what you need to know about each of these.

(Want to jump ahead in the episode? Click the featured times below to skip to a specific section.)

Honest Takes:

Are you trying to create a retirement plan that considers all that is going on right now? Should you be concerned about the Coronavirus? Are you implementing spousal benefits with your IRA? Are your tax strategies preparing you for the future?

IRAs are one of the most popular retirement tools but sometimes there are myths associated with them. Some couples are only taking advantage of half of the benefit by overlooking spousal benefit on earned income. Brian shares a client example of a couple who maximized their contributions and transitioned their taxable money to tax-free.

What Do We Need to Consider:

The SECURE Act brought a lot of changes. Does it impact the spousal IRA contributions? Consider tax strategies now to minimize the taxes on the next generation.

The Coronavirus has caused quite a stir in the country, as well as in the stock market. When you’re investing, you need to be somewhat conservative to figure out what you can be okay with. You don’t know what will happen in the market or with the world.

If taxes change, what will your investments look like? If you don’t have a tax plan now, you could have a major problem when it comes to your investments later. Brian had a client who experienced this in a big way. Having a tax plan and filing your taxes are different things.

Sometimes people underestimate how long retirement might last. You can never really know, but you have to plan accordingly. If you retire early, plan on taking more money out in the beginning when you’re traveling and doing more things.

Keep in mind that we still don’t know all the details about the Coronavirus, so making drastic moves with your retirement plan now isn’t necessary. This isn’t the recession of 2008.

Listen to the full episode or click on the timestamps below to hear a specific segment.

[0:15] – One of the most popular retirement tools is an IRA. Some couples are only taking advantage of half the benefit though.

[5:32] – Does the SECURE Act change the spousal IRA contributions?

[7:12] – What did Warren Buffet say about the response to the Coronavirus?

[8:31] – What options do retirement savers have in light of the Coronavirus?

[11:04] – If taxes change, what will that do to your investments?

[14:31] – Do people underestimate how long retirement might last?

[18:32] – The economy now is not like in 2008.